~ Strathmore University Centre for Intellectual Property and Information Technology Law (CIPIT)

Lessons on Brand Strategy and Intellectual Property Management from Nestlé

This blogger is grateful to the organisers of the 13th WIPO-WTO Colloquium for arranging a study trip to Nestlé to learn first-hand how multinationals use the intellectual property (IP) system to drive their businesses around the world. Enter Nestlé: a brand-driven global company with an unmatched product and brand portfolio. This Swiss multinational has 10,000 different products with over 1 billion products sold every day. Nestlé has a product for every moment of every day, from morning to night and from birth to old age. As a result, Nestlé has close to 100,000 trade mark and design protections worldwide. Nestle’s brands are clearly its most valuable asset with an estimated worth of 1 Billion Swiss Francs (CHF). Therefore the Legal Team at Nestlé says that it must preserve/strengthen its immensely valuable IP assets and it has developed intricate IP management strategies.

Nestlé in-house IP legal team are responsible for the protection and defence of Nestle’s IP rights. They work in close collaboration with the various Nestle business entities and provide specific advice and insight to help identify, avoid and manage legal risks associated with IP. Nestle’s Legal Team has a three-pronged approach to IP: respect IP of others, create strong trade marks and competitive intensity. With regard to respecting others’ IP, the aim is to create and maintain full freedom to operate by not infringing third party rights. Creating strong trade marks means creating competitive barriers by chosing strong brands. Competitive intensity refers to creating competitive gaps by enforcement and defence of Nestle’s trade marks. Nestle’s Legal Team handles all IP matters related to trade marks, designs and copyright whereas patents are handled by separate technical team. The IP process at Nestle involves various steps including clearance, protection, monitoring and defence. Nestlé SA’s IP assets are held by Nestec SPN which licenses the various IP rights to the respective business units.

As mentioned above, Nestlé currently has a total of 99,853 trademarks and designs registered around the world comprising of 92,712 trade marks and 7,141 designs. To put these whooping figures in perspective, consider that the famous Nescafé brand alone is made up 327 trademarks (4,419 registrations worldwide), 40 designs (511 registrations worldwide) and 357 domain names. With so many brands to protect, Nestle filing strategy usually favours the international route (using the Madrid system for instance) but its strategy depends on several factors such as geographical scope, urgency of the project, costs, speed of the examination and rigour of the trade mark office examination.

Nestlé’s global presence requires a thorough IP protection strategy that provides the broadest protection (eg. merely registering a word mark vs. registering word + device + design). The strategy also aims to cover (most of) the existing markets so as to enable enforcement of protection. In addition, the IP team is continuously on its toes since Nestle’s brands are constantly changing to be relevant and meet consumers and clients expectations. Finally, the IP protection strategy takes into account the economic situation and ongoing challenges in Nestle’s markets particularly those prone to counterfeiting.